Episode #207: Five Business Essentials Every Boutique Must Know with Sara Burks & Ashley Alderson

Hey, it's time for episode number 207. And joining me is my cohort, my partner in crime, I don't know, my fellow educator of boutique owners. And that would be Sarah Burks, who is our director of partnerships and education here at the Boutique Hub. And, guys, get out your notebook now. This is going to be the episode for you. Let's talk about your business strategy and the juicy details of what actually works, from mainstream fashion to fashion on Main street and the entire ecosystem behind it. How do we scale your company and do it with the balance and the happiness that we all seek? Let's hear from those insiders, experts, and strategists that actually make it happen. I'm your host, Ashley Alderson from the Boutique Hub, and I can't wait to chat. So each week, Sarah and I get together to do a Facebook live inside of our retail Bootcamp program. So Retail Bootcamp is our most in depth boutique bootcamp training program that we offer at the boutique hub. It's 12 weeks, 12 modules, every single piece of your business, from numbers to merchandising to mindset to money to Facebook ads, you name it, it is the most comprehensive thing on the market. And we are commonly finding ourselves answering the same questions. So we launched the program both in January and in June each year, and several hundred boutique owners joined us inside. And it's amazing to us to see so many people struggle with kind of the same tipping points, if you will. So we wanted to make sure we came today and answered some questions that we think you might be hung up on too, because there certainly are trends in terms of what people feel comfortable with or where people maybe don't see past the creative side of owning a boutique, and they struggle more with the retail scientist side of owning a boutique.

So.

So we wanted to come together today and really talk about this business in terms of full circle, what it means to have a successful business in this industry, not just on the marketing side of things, but really mindset side of things and financial side of things. I'm really excited that Sarah had some opportunity to join me today and walk through what we're calling the five essentials to scaling your business from inside a retail bootcamp. I hope you guys love these five takeaways, and I would really love it if, when you're taking notes, circle the one that makes the most sense for you. Then DM me over on Instagram. We're gonna have a giveaway, which I'll tell you about at the end of this episode. If you stick around. So make sure you take notes, circle the most important one, and then follow the instructions at the end of the podcast. DM me either otiquehubbusiness or ajalderson on Instagram. And we want to make sure that we really have a chance to help more of you. That is a huge goal of ours in 2019 is to see more boutique owners succeed, then struggle. Because we know what it's like to be in your shoes and we know what it's like to feel kind of lonely at the end of the day. Like, am I the only person dealing with this? And the answer is, you're not. So I hope you find some clarity and great takeaways with these five essentials to scaling your business from inside of retail Bootcamp. All right, guys, let's get to it. Get your pens and notebooks out. Woo. We're on. Hey, guys, welcome back to the podcast this week and I'm joined by my partner in crime, Sarah Burks. And we're about to have a very candid conversation on the show today. So I'm really glad that you're listening to this episode. So, hey, Sarah.

Hey, guys, how's it going?

So you and I have these conversations almost on a daily basis because we're right in the middle of our boutique or our retail bootcamp. I almost called a boutique bootcamp, which is kind of interchangeable, but our big course that we launch twice a year and it's a 12 week program, we're in the middle of it weekly meeting with several hundred boutique owners who are inside. And would you say these are what we're going to talk about today? The most commonly asked questions that we get or common answers that we give to people looking to grow their business?

Absolutely, I would say 100%. We work with boutiques across the country that, you know, they all have a lot of the same problems and they come to us with these questions and you want to see people succeed, you want to see these businesses scale, but it kind of goes back to some of that foundation of their business and why they're really in it and what they're spending their time concentrating on. And yeah, so we get into, we get into that in real depth in boot camp. And, you know, it's so fun to see it all turn around for these businesses and where they start and where they end up. It's awesome.

Yeah, man. I think you hit on something that's so important because a lot of times people will come to us saying, man, if I could just learn Facebook ads or if I Could just learn Pinterest or if I could learn how to drive more traffic, then my business would be successful. But what we find most often in bootcamp is just like you said, it's the foundations. We go back to the root of it all and build a business up from there. And I feel like that's really where we see the most success in some of the most common, like foundation pieces, especially when it comes to inventory and finances that are often missed. Would you say?

Oh, 100%. It's almost like. It's almost like that, that toy you have to put together for your kids at Christmas that comes in a thousand pieces and you get so excited, you rip off the out the box, you dump everything out on the floor and you scrap the instructions and just start going after it and then realize it doesn't work. And it seems like business owners were all so excited to get in the business that we jump in and especially boutique owners find ourselves in LA or Vegas or Dallas at a market, going a thousand miles an hour, buying inventory, but yet we haven't set up the foundations properly. We actually don't even really have a business in place. So that's what Boot Camp's all about is, you know, going back to those basics and for retailers to understand that solid foundation that they're going to build a business on so it doesn't fall apart.

Yeah, absolutely. And I would say even some of the retailers that are inside, I mean, we've got some multi million dollar businesses that are inside that are still going back to the bas. So I would say no matter what size you are, this is still crucial. And it's amazing to me how many business owners of significant size maybe still haven't worked on some of these things because of just what you said. You know, a lot of successful businesses, they get in there and they're doing like minimal viable product. Right. They're just trying to put the pieces together as best they can to see if it works. They prove the concept that it does work. But then they're like, oh man, I really could optimize, I really could grow more if I knew these certain numbers or increased by this percent. And I think that's where that scale really comes from, is recognizing that gap.

Absolutely. And not spreading yourself so thin that you're doing a thousand things at 10% versus doing the big bulk things, 100% effort and, you know, having. Having the success there that you can build off of. Yeah.

All right, so the topic of today's show is the five essentials to scale Your business direct from Retail Bootcamp. So we're taking some of the things we're talking about on a regular basis and we're mashing them up in the show today. Are you ready for this?

You bet. This is going to be fun. I can't wait.

All right, let's do it. Okay. Number one is knowing your strengths and your get this resources, not weaknesses, resources. Can you talk about that?

You bet. I mean, we are all given gifts and some of our gifts are different than other people's gifts. And when we can really hone in on what that is and build that up, that creates that, that culture, that desire that people want to be, they want to be in that circle. Because what you're bringing, what you're giving off is awesome. That's your strength. Your resources are what you're bringing to the table. Also, whether that's financial or whether it's time, those things are huge as well. And you know, you can't make more time in the day. We are all given the same amount of time. Some of us come to the table with another part time job. Some of us come to the table with a full time job and a full family. That being said, your business has to grow around those things and become a part of your life.

Right?

But you're never going to get another five hours in the day. So knowing where your strengths are and knowing what resources you have and what you're able to give at the given time is going to help you be able to build that business. To say you want to, you know, work at a 70 hour work week, but yet you're already committed to a 40 hour work week with somebody else. That's not very realistic.

You always say something in boot camp. Do what you do best and hire the rest. Can you expand on that? Because I think that we often forget that we think that we have to be the hustler of our business. But I think knowing your resources in terms of what you're saying is really looking at your business through the eyes of a CEO versus a solopreneur who's just trying to hustle and do it all and not have to pay anyone to help them along the way. But rather than looking at, you know, building our team as paying someone, it's really investing so that we can build, you know, 10x the ROI on the business that we're building.

Right.

You do the hundred dollar an hour jobs and you hire out the $10 an hour jobs so that you can really focus on what's going to build income and revenue in your business versus you just trying to do it all.

Absolutely. I mean, especially as a woman, you know, you try to put on all these hats. You wear so many different hats. And as a business owner, I mean, you are. It's easy to say you're everything from the maintenance man to the marketer to the buyer to the. To the. Everything the CEO is doing. Right. Managing your people, managing your home, all these things, managing your finances. But again, it goes back to. You don't have that much time in a week. Right. And the effort you're putting out, the things you're spending your time on, they need to be bringing in money. It needs to have a return on your investment of time. So if me, for example, I'm not a graphic artist, and you could laugh and she would say, amen to this as well. You say the word canva to me, and I say, yeah, who's helping me with that? Because that's not my wheelhouse. And I'm perfectly fine to hand those jobs off to somebody else, but actually, you know what it does is it frees up my time to do what I do best, because not only would my canva graphics. They'd be done, but they wouldn't be done. They wouldn't. They would not. Yeah. People wouldn't be drawn to those for sure.

They would post some examples in the show notes. I'm just curious.

I have nothing to hide. I have nothing. But what I'm saying is they wouldn't go along with the brand, they wouldn't go along with the vibe that the hub is giving off because they're not consistent. My mind doesn't work that way. So that's not my gift. That's not my resources that I'm bringing to you. You know, when you hired me, you hired me as a graphic artist. So knowing that when it comes time for a post that I need to do or advertising of any sort, I need to do for. For retail boot camp or whatever it is, we have a person in play that. That's their deal, and they can bust those things out literally in seconds. Compared to the hour that would sit, I would sit there and struggle. And at the end of it all, it wouldn't be very good anyway. So, yeah, definitely do what you do best and own it and win at that. So those other things, hand those off to somebody else, and they get them done so fast because that's their gift. That's what they're bringing to the table.

Yeah. Can I expand on that?

One minute.

You know, I often I'll relate things to Facebook ads because I think it gets talked about a lot and there's so many questions about it. But I think what you mentioned in terms of you understand the need for branding and you understand overall, conceptually, what it should be. Right. That it needs to be certain colors and, you know, to go to Canva and you know how to judge if it's working or if it's not, that maybe creating it is not your gift. So a lot of times I think that. Let me just get on a soapbox for a second. There is a huge group of businesses, not just in our industry, but across all industries that make their living as agencies selling you Facebook ad creation and SEO development. And they'll come in and they'll play on the fact that they think you don't know anything at all about it and sell you services for 8, 900, 1200 dollars a month for them to do it all for you. And you feel like you're taking this huge thing off your plate. Where the problem is, is if you don't know right off the bat how to do those things or how to measure success in those things, you're kind of opening yourself up to maybe, you know, some. Some issues down the road because they could take advantage of you. So while, yeah, so while you're saying, man, you've got to know those things up front, I would say even like Facebook ads and those types of things that are common to get off your plate, you have to have a basis and understanding for them before you hire them out. So, you know, you're in control of the outcomes that you're really paying someone to get for you.

Absolutely. I'm going to take this back. And those of you that know me know that I've been in retail for a long, long time. Started in retail in 93. So I've been. You're talking Facebook ads. I can even go back and talk print ads, newspaper ads, things like that. It was huge to us. When we were putting something in our newspaper, it had to have a certain look. And we had a person. We had a guy. And I always say, you have a guy doing what, these. These tasks, right? So we had our person at the newspaper. We would take a draft and we'd say, okay, this is what our idea is. Come up with a concept. However, we don't want it to look like everybody else. It needs to have X, Y and Z features within the ad because people can look at it at a glance and they would know it's ours. And having that Consistency across the board to give off that branding, that vibe, that omnichannel marketing, that's, that's huge. So even though we were going to hire this part out, it still had to be consistent with what. You're exactly right. What you're talking about, with what our, our plan for our business was, our brand.

Absolutely. All right, so number one was knowing your strengths and your resources. Let's talk about number two, knowing what is an investment versus an expense in your business.

Well, I think this kind of gets into what is. You know, a lot of people are like, oh, but it's so fun to go on these things. And it's so fun to, you know, just keep buying and all, all that stuff. And it is, retail can be so fun. But it is a monster, right? Anytime you go into business and for those people that are listening to this, that maybe aren't boutique owners, but they're small business owners, they get this. Your business is a monster. It needs to be fed, you need to nurture it, you need to, you need to keep it under wraps, you know, because otherwise it can overtake everything. But knowing those things that you're investing your time in and if they're going to, you know, have a good return on investment, or if it's just, if it's an expensive things that, you know, can kind of eat away and continue to just take over on your money, your payroll, your buying trips, education, things like that, you know, the course, retail, boot camp, that's education, inventory, all those kind of things affect your bottom line. And you really need to, you really need to know what are you investing your time and energy in and what is it bringing back to me? Is this a good use of my time? Is it a good use of my energy? Again, going back to example one, is it a good use of my energy to sit down in front of this computer and try to bust out graphics? No, it is not. Same being said for equipment, your per, your point of sale system, this is an investment that is really going to help you in your business. And there's a lot of retailers out there that just haven't taken the plunge on good solid equipment. Whether it's a camera or a point of sale system or, you know, a responsible vehicle or a trailer or whatever. When you're doing these pop up shops, things like that, that are going to take the headache away at the end of the day, right. Because they're good solid equipment. And talking about that point of sale system, I can tell you about doing inventory with pen and paper that Took days at my store. Then eventually we got a good point of sale system. When it came time to do inventory, we could bust that inventory out in a couple hours. Talk about a good use of my time. That investment in that good point of sale system, I just won back days of my life. And it was accurate information. So knowing, knowing where you're spending your money and what you're investing your time and your money in is, is huge in your business, man.

I think it really goes back to. I think a lot of new boutique owners especially have this battle and really it's a mindset battle because they feel like I could grow my business or I could finally get a profit or I could finally cut myself a check if I cut my expenses. But really it's, that is the complete, most backwards way of thinking about it, right? You can only grow your business from growing your revenue. That's the only way to grow any business in history. You don't grow by cutting expenses. So what is an expense? What is an investment? So we'll use the boutique Hubs membership even as an example, $24 a month. Sometimes people will cancel saying I just need to cut expenses. But really if they were looking at it or any, you know, membership or course or education for that matter, what could I learn from this? That I could double my return on investment immediately. Like how could I use my membership to make me $48 this month versus spending 24? And just like you said, the point of sale system, man, that is exactly that. Look at you invested because they aren't cheap, right, to invest in a point of sale system. But look at what it saved you over time and look at how much more you could build margin or you could take better markdowns if you have the data to work with right away.

Absolutely. And you know, one thing we talk about buying, you know, we, and we talk about them as investment trips. Not necessarily just buying, not buying trips. But say you're in a bind, your inventory is low and you know you need to add merchandise into your store onto your website immediately. But it is. If you were to leave your store say this week and you were to fly to LA and you were to staff your store with or your, you know, your warehouse, whatever it is with X amount of employees that can take up the slack while you're gone, there is a value to that. And knowing that number, what that cut, that break even number is before you even leave your store and drive to the airport to get on the plane to and then come back, you have to, you have got to make up that money somewhere, right? So that's the expense of it all. Now there's an alternative. So say you're in this position, maybe the best decision for you as a business owner that right now is to call a buyer out in LA that can help you with this. Call a service provider that can do some of this buying for you. Right? Because it can take that time to make those phone calls. However, it very well might be the responsible decision for your business at that time. Not all the time, but every once in a while, just because it's fun and you enjoy the experience of it all. But is it a good return on your investment? What is my break even point from the moment I make that decision that I'm leaving my store to go do something to when I come back? So just like, yes, the point of sale, it can be an investment, but yes, it can reap dividends. Back for you later. Looking at things like that. But also some of these things that we do that are unnecessary expenses, especially when they're rush decisions, things like that, they all really, really do add up. And knowing that every decision you make in your business does affect your bottom line, whether it's for the good or for the bad and not to make those rash decisions, man.

Yes. So good. All right, let's talk about number three and staying in your lane.

You bet. Staying in your lane. I. We use this all the time in the hub. I, I think this might be the one thing I say the most every day to boutique owners, because we hear a lot about competition and we hear a lot about other stores moving into your area or people trying to do the exact same thing you're doing. But the thing is, you started your business with a passion. You started your business for a purpose, and your customer is not. No matter what, it's not the same customer as the store down the street or the next website. And if you think it is, then you haven't really thought through who your customer is enough or really what your purpose was. You know, I talk a lot about our store and the fact that we had a little bit for everyone. Well, it ended up becoming this big monster that we couldn't feed enough.

Right.

Because we had. We were trying to satisfy too many people. We got away from what we really started out being. So we spread ourselves way too wide and too thin and we ended up doing a lot. Something's really good, but really, for the most part, we were spread way too thin. So we weren't trying to keep up with Amazon. We weren't trying to keep up and try to beat every other little person. What we really needed to do is just put our nose to the grindstone, concentrate on who we are, what we are, and be amazing at that. And because we were amazing at that, our customers came and supported us in that when we were trying to be something for absolutely everybody. Honestly, what it was is it kind of turned our go to customers off because we weren't able to offer them that same customer service that we had before. And it basically it came down to the fact that we got out of our lane and we just tried to be too much too fast. Yeah, it's one of those things that I see a lot of businesses doing it and I see a lot of businesses just trying so many new things that they haven't really tested the waters long enough in where they're at to know if it really worked or not.

Mm, man. It's a saying that we use a lot. When you target everyone, you reach no one. Right. And not to go back to a previous podcast episode, because I said this before, but so many people today want to be a trendy online affordable boutique, but there can only be so many until we all take a step back and you go, you know what? What are the needs of my customer? Truly? What does she need? What is she struggling with? What fears does she have? And now how can I be a solution to her problem? And that's where you really begin to uncover what makes you different from everybody else. So you can really lean into that and market to that, and that's what's going to attract more of your ideal customer, 100%.

One of my favorite books that I read recently is the Curiosity Muscle by Diana Kander. And this completely sums up what I feel like a lot of small businesses and boutique owners specifically struggle with is they come up with a plan and they do. Well, things go well for a while and they assume they're going to continue to go well. Well, what's happened is their curiosity muscle, which is their brain has gotten lazy and it's gotten complacent and you have not, you've not continued to be like going back to number, you know, our number one, being alive in your business and staying active. You've gotten yourself spread out and you haven't really gone back, looked at what that customer that was voting with their dollars with you to begin with, right? Why they liked you, what set you apart, why were they with you? You've gotten away from that. And instead of getting more curious about that customer and Keeping them engaged because people can jump ship quickly instead of winning with them consistently, you've kind of gotten lazy. And then, you know, that's not a good thing in business at all. I think another thing about boutique businesses and our customers, very niche, right? I think that we. People like to shop at boutiques because of the uniqueness. They like to shop at boutiques because they're going to find some different type items and random things.

Right.

That's why I love to shop at boutiques. I love it because you just never know what you're going to find inside. Well, I think that going back to making assumptions about your customer, you can get yourself in such a bind. People aren't simple. They're not just shoppers aren't. Don't shop for simple things like they used to, if that makes sense. Right? Like, we like uniqueness. We like that creativity. We like that, we like that atmosphere and the experience that we get by shopping in a boutique. And I'll guarantee you, 90% of boutique owners started off that way, started off with an amazing experience. Experience and understanding that customer and setting themselves apart from the next person. But over a while, we get a little lazy and that curiosity muscle might get a little lazy. And next thing you know, you spend more time concentrating on what Susie down the street is doing instead of doing what you do and doing it awesome. Do what you do best.

Right.

So anyway, that I, I will say that is. That's become a problem.

Would you say that competition is a good thing for that? Like, you know, we, we talk a lot in the Hub about community over competition and the importance of all of us. You know, like a rising tide lifts all ships. Right. We all need to work together. But the thought of competition, which drives fear in us is still a good thing because it doesn't allow us to become lazy or complacent. Just like you were saying.

Absolutely. I believe that 100% competition is the best thing for your business because if you do, if you are the only, you know, the only shop on the block, you're gonna get, it's, it's just, it's gonna happen. You're gonna feel like you're winning no matter what you do because your, your audience does not have other alternatives now, you know, they can always go online or they can jump from one store to another online quickly. But to be, to be pushed, to be motivated, to be challenged, really, that's, that's when the good stuff happens, right? And you know, we see that in our daily lives. We see that with our Physical fitness. We see that with our family, we see that with our homes. We see that with everything we do. You know, being challenged keeps us alive, and it keeps us motivated to do better.

Absolutely. All right, let's jump to number four on our list today to scale your business, and that's making sure you've got the right financial foundations set up. And I think you. We could have a whole podcast episode just on this topic. I know, because the modules inside of Retail Bootcamp are that robust, where it's like four weeks of just financial conversations. But can you talk about maybe what's the. The most common question or issue you see with boutique owners in terms of that financial foundation?

Oh, gosh, I will say this is. I was here at one point within my business too, but financial foundation is huge. Understanding where your money's at within your business, that's key. That is the number one mistake business owners make. And I think it's because it's scary. I think. I think the whole idea that checkbook, a balance checkbook, balance accounting that people try to do, you know, let me quick just log into my online banking. Oh, yeah, awesome. I've got some money. Let's jump on a wholesale marketplace or buying stuff or let's, you know, let's take everybody out to lunch or whatever it is. You know, that's not a realistic way to run your business. And I say all the time in Bootcamp that if you don't analyze your numbers, pretty soon there won't be any numbers to analyze at all, because it'll all be gone and you won't know even where it went. And again, going back to what you said earlier, it seems like a lot of business owners think, oh, shoot, money's getting tight. I'm going to just cut payroll. And you're cutting. You're cutting off a lifeline to your business within that. So understanding where your money's at, understanding the ebb and flow of things, what's coming in, what is going out, what can I rein back in? What have I gotten a little crazy with? You know, what. What part of my business do I need to feed more? All these things are huge. And we talk a lot about it in Retail Bootcamp because it. Financials can be scary. However, it's part of it. If you're gonna have. It's kind of like having a kid. Dirty diapers, they come with it. You know, you have a lot of rewards, but you cannot get away from those dirty diapers with your kids. You can't get away from the numbers. Whether they're good or bad with your business, you've got to look at them. You got to be. You got to be in touch with them. That's for sure.

Amen. Number one is if you don't have a balance sheet or if you are not looking at your P and L on a weekly basis, there's no business.

Right. I talked about. I talked to boutique owners all the time that, you know, I'll say, okay, let's pull up, you know, pull up your balance sheet to pull up your P and L. Let's take a look at this. Or, you know what? You know, what's your bookkeeper helping you with? Because I know right off the bat they've hired this out, and they'll say, I don't know. I hired a bookkeeper. But I haven't really asked them anything. They haven't called me in a while, so I haven't asked, like, oh, my gosh, how do you even know what they're doing? You know? And it is so important to have this conversation. I don't care who you are in a relationship with, if you never speak to that person, you're going to lose touch with them. Same with your finances. If you are not looking at them, learning from them, analyze them, reflecting on them, you don't know them, and you don't have very good relationships with people like that. Or, you know, I. I look at this as a. As a. On a live relationship, your finances, right? So there's no Fortune 500 companies that just wing it with their financials. They are successful for a reason, because they've got people that. That's what they do. That's where they live, is in those numbers. And they might be telling that more artistic person within the business, okay, this is where we're at this week. This is our goal. This is what we need to do. But at the same time, goes back to what we talked about before. Do what you do best and hire the rest. However, you've still got to understand what a balance sheet is, what a P and L is. And I highly, highly, highly recommend QuickBooks. I do, because that's what we use. And I just feel like I laugh because I think QuickBooks was great for our business. Because if I was trying to enter something and it might not be the thing I was supposed to do, setting up an account or something, it would basically prompt me and, you know, kind of like, sarah, are you sure you want to do this? And I'd say, yes and come back, sarah, are you sure you want to do this. If you do this, this, this, and this. So I'm. If I can do it, I think anybody out there can do it. But at the end of the day, it's not negotiable. And we talk about this a lot in boot camp and, you know, making sure you're owning this part of your business, because otherwise you're going to have to be answering to the bank, you're going to have to be answering to the irs. You're going to be answering to some really scary people if you don't know where your money is. That's for sure, man.

Absolutely. So a weekly date with your numbers has to be number one for. I mean, just speaking for me personally, too. Every Friday, that's my date, where I go through, like, every report that we run and talk to the team and really analyze. Because if someone's listening right now and they're like, oh, my gosh, I'm overwhelmed. Or like, you just puked in your mouth a little bit when you heard us talking about these things because you're like. Like, I'm not a numbers person. It's okay. But once you. Once you sit down every Friday and you start to have the weekly date with your numbers, those numbers start to speak with you and tell you a story. And just speaking from experience, I'm a communications major. I skipped every math class I possibly could and had way more help than I, you know, probably should have during math in high school and college. It wasn't until I learned how those numbers could speak to me and tell me a story that would then allow me to communicate and be creative that it really, you know, hit home for me. So every successful boutique owner has to be both a creative fashion person. Right. The art of retail. But you also have to be a retail scientist at the same time and let those numbers tell you a story. If you love to buy, which I know I've heard you say this, Sarah, that you think a lot of boutique owners have, like, a shopping addiction.

Yeah.

If you like to buy, then if you've got great financials, you understand your expenses, you understand your planned inventory and your budget for the month ahead, now you can have a lot more calm and have a lot more fun while you're buying because you can rest assured you're doing it in the right places.

Absolutely. Because there's nothing more fun than to see that, you know, what if you are just looking at that checkbook balance, it just see it come up, you know, to see that number rise and to know you're making Good decisions for your business. There are so many people. At the end of your podcast, you always ask people, you know, what are you more scared of? Like, what do you say? Internet trolls, snakes, or payroll? And, you know, payroll is inevitable. It happens every couple weeks or every month. It. It happens. Taxes happen. You cannot avoid these kind of things. We sell things in retail to make a profit and to be profitable. And that in and of itself, it. We do these things. We're excited when the cash register goes to Chang. However, we put ourselves in a really bad situation when we don't pay attention to that. And we just kind of halfway just think about that money that's coming in, but never think about the money going out. Never think about that box of hangers that we just ordered that we did not need, but we just ordered them, or we ordered pink tissue paper, even though we already had four colors of tissue paper on hand and it costs US$20 to have it shipped in. You know, things like that, we just do it, right? Because, oh, I think it'd be pretty if we had that, or I think this would be nice. Well, all those little things really add up. Was it the best use of our time? Was it the best use of our resources, our. The financials that we have coming in right now? And at the end of the day, one thing we really talk about a lot is how do I pay myself? That financial foundation is. Is got to be in place if we want a paycheck. And I will say that is a huge part of retail boot camp is knowing how do I find money within my business to put into my purse, in my hands. And that's. I think one of the reasons why, you know, retail boot camp is so popular is because having been a boutique owner that didn't pay myself for a long time and having been somebody who was scared of processing taxes and. Or tax return time and. And scared of payroll, I. I remember what those nights were like before. You know, like laying in bed at night thinking, holy crap, how is this going to be? How's this going to happen? How am I going to make this work? So being able to put the actual real life lessons into that and relate with business owners and solve those problems. I think that's a. That, that is. That's again, such a huge part of retail boot camp. And it all comes back to our finances, really.

You often. You often use this analogy where you see, rather than seeing clothes hang on hangers, whether it's in your storefront or in your warehouse, you see dollar bills hanging on Hangers. Which brings me to point number five. I want to talk about financials. I know you're chomping at the bit to get to this one. Which brings me to number five, which is not just about financials, but it's about inventory. And stop being emotionally attached to the fashion that you're carrying. But look at really, what is the inventory telling you in terms of numbers so that you can take those little dollar bills and put them in your.

Pocket, you know, 100% inventory turn. This was a. This was like a foreign language to me for years within the business. And all of a sudden, it happened because of our finances. It happened because of, you know, just whatever. We can blame it on the economy. We can blame it on whatever. But at the end of the day, it really came back to the fact that wasn't. I was making good financial decisions for the business, and something needed to turn and turn around. And I called my guy. I got a guy. I got a guy that was able to help me with my inventory controlling and. And making a plan for my buying and help me understand where I was at currently and how much inventory I had on hand. And the thing was, the scary deal is, at one time, I probably had enough inventory in my store to last me. Last me probably 15 months without ever buying another thing. That's a lot of cash. That is a lot of my personal cash just hanging there on hangers and taunting me. And I remember walking in the store because one of the things I'd always make sure I did is walked in the store from the front door every day, you know, so I could get a view of what the store looked like from a customer standpoint. Well, that was all good and fine, except for when I started looking around. And that wasn't a hang. That wasn't a top hanging on a hanger. It wasn't a pair of jeans hanging there on a hanger. That was $50 of my money that I started seeing it as dollar bills. And when I switched that mindset, all of a sudden I was like, wait, I don't want my money just hanging here. I want that money in my pocket. I want that money in my bank. Because you can't spend inventory. You can only spend cash. And so I do. I get really. I nerd out, geek out, whatever you want to say about inventory. In turn. And making sure that your inventory is working for you, not against you. So that's a huge part of what we talk about in Bootcamp.

Can you talk just for a second? Because we just had A big session this week just on markdown strategies. So can you talk about how you start to view your inventory and know when is it aged enough that you really have to get aggressive about moving it around and moving it out?

Yeah, and I will say a lot. This is another question. A lot of people say they're like, how many days do I need to leave it on my floor? Well, you know, there's so many different things that go into those decisions, but everything has a life cycle. Everything is aging as we speak. Inventory is aging in your store constantly. It's never going to be any better than it is right now. You know, today it's worth X amount of dollars. Three weeks from now, the demand for that is probably going down. So it's, it's losing that value. And it's really important to analyze your inventory accordingly. Where are you at in the life cycle of this product? Am I approaching its peak? Am I approaching the point where this product is going to expire? Now I really need to get serious about a markdown strategy. And what happens again? We go back to kind of a few points before being complacent or being lazy and doing blanket sales. And all that happens with that is we end up marking down the good stuff, and we end up getting rid of the good stuff really fast, which leaves us with the older stuff. So being able to really be that retail scientist, when you're looking at the inventory that you have on hand and making sure it's moving quickly and efficiently to generate that cash so you can reinvest that back for more product, that's huge because we are not investing in a product. Like I said, that is going to look better later. It is what it is today. And honestly, one of the things I hear a lot and I, I, I was this way, too. The UPS driver would show up and I would be like, oh, my gosh, awesome. What did we have? You know, I'd rip the box open, I'd open it up, we'd all get excited. And I know there's boutique owners right now shaking their head like, yeah, yeah, yeah, that's me. But then we unbox it, and we're like, what the heck is this? When did I order this? What was I thinking? Those what was I thinking? Buys cost me tens of thousands of dollars. And when I, when my mindset changed, I started realizing that box of stuff I just opened up that I'm not excited about. If I'm not excited about, my staff's not excited about. And I damn sure know my, my customers are not going to be excited about it. Guess what that whole box is? That's a trip to Disneyland. That's, that's, you know, potentially another summer vacation of some sort. Or a car, you know, at least a car payment. And there it is, just sitting there wrapped up in plastic, laughing at me like, haha, here I am, you know, and I'm thinking, what was I doing when I bought this? What? You know, how many cocktails had.

I heard you were drinking margaritas.

I know, and that's. Yes, but that's the reality. And all of a sudden you're thinking, okay, now I've got a fake getting excited about this and turn this into cash because I want this gone right now. And what happens is that stuff ages and it's in. You struggle turning it right. And instead of going with a game plan of selling it, selling that six pack, at least three of them at full price, all of a sudden I find almost all six of those on the clearance rack because they're not what my customer wanted. So anyway, that goes back to that whole buying and making sure you have a plan. Making sure when you go to market you're prepared. We talk a ton about this. You know, how to make sure you have a game plan going into that battle of, of market season. Because it is. And we can get so lost in swiping a credit card and you know, just yeah, yeah, yeah, I'll take it. Oh my gosh, it's cute. I think my customers will like that. And then all of a sudden you turn around, you go to the next booth across the way and, and oh my gosh, that's so cute. I want that. I want it. It's cute. I'm going to sell it. Da da da. Now fast forward. UPS guy comes in and you're like, really? I bought another blue blazer. I already have four blue blazers. Why did I, you know, why did I do this? Well, you did it because you didn't have a plan. You did it because you are not in control of your inventory. And so, yeah, I do. I'm sorry. I can get really excited about this, but I feel like once a boutique owner gets control of this process, that's, that's a huge part of their business. Huge, man.

Absolutely. You use this analogy about milk, which I think is so smart, I'm surprised you didn't bring this up. Can you share that with us?

Oh my gosh. Okay, so, yeah, exactly. Well, you go to a. It's, it's hard to kind of say you go to market and because all the. Everything's a variety, right? You're looking at all sorts of different things. Well, you go to market and say, super easy math. Say you're going with $5,000 that you need to go buy product for the next season. Okay? So take that into the grocery store, right? You know, you need to go do your weekly grocery shopping and you say, say you have 100 bucks and you're going to feed your family and you're going, going to the grocery store again. This is the buying side, right? Stay with me. You go in there, you're not going to buy a hundred dollars worth of milk. No. Because even though your family really likes milk, that milk is going to expire. You, you have to buy limited milk each time you go. Because what happens, you bring in too much and it sits there and it, to be honest, it's going to get gross, it's going to curd up, it's going to be disgusting, and nobody is going to eat it or drink it. So if you have that sitting there in your refrigerator and you brought it in at the wrong time or brought in too much of it, and your family's only able to consume X amount of milk in an allotted time, pretty soon you're staring at it and saying, well, kids, there's milk in the refrigerator. Have some cereal. And they're like, no, that's expired. That's not healthy. There's no way I'm going to drink that. And at that point, the only thing you can do is feed it to your cats or dump it out or whatever. But the thing is, there's zero value in that. When you bought it, there was good value in it. Every day it becomes less and less desirable to the point where it's not even tolerable. And I will say your inventory does the exact same thing, because when you first get it in, the majority of times, we're super excited about it. Every day we get a little less excited about it. To the point where as a business owner or a staff member in a store or a warehouse, whatever, or somebody coming onto your. Your website, you're like, oh, there's that shirt again. They still have that shirt. And it just loses that excitement. And eventually, like that milk, you just have to get rid of it. You have to throw it out. So what's the last thing I was just going to say about that is if I know my milk is almost reaching that expiration date, I can't get lazy and just think, oh, well, maybe my kids will drink it tomorrow morning with Cereal? No, that night before. I better do something with it. I better put that into something. Making a soup or making gravy, whatever I'm going to do, get the most value out of it I can. Otherwise I've just become lazy and complacent and I'm allowed it to expire and it's like throwing my money away, man.

So good. And let me, let's take it to this direction. I know a lot of times when you and I work together, you've got such a great perspective on how to do that in a brick and mortar store. So you're re merchandising things. You're is putting things on and wearing it. So you're showing your customers how it can be styled. You're, you know, a number of different things you could do, new signage, you name it. But I also want to mention when it comes to e commerce businesses that are listening, this means if you aren't re merchandising the homepage of your website at least every other week, if not weekly, it's the same thing. Your customers are coming into your website and they're seeing the same thing all the time and they're feeling like nothing's new, it's not getting re merchandised, those things aren't getting pulled up to the front that really need to be moved out or even on social media. You know, there's a lot of businesses that are running four to eight new arrivals per day online. And just like Sarah said, it's easy to rip open that box of new arrivals and be really excited about what just arrived from the UPS man. In fact, so excited that now to use something that's two weeks old is old and you feel like your customer still isn't going to be excited about it. When in reality there is a certain period of time where it's not old to your customer yet, it's just old to you because you haven't done anything with it. So make sure you're restyling and reshooting things and putting them up on social media in a new way because your customer isn't going to see every social media post you ever make. They need to see something about seven times to take action. So how are you re merchandising and putting those things up across all social media channels or an email so that they don't miss that hidden gem in your store or your warehouse?

You bet. And we do touch on this a lot at retail boot camp and in the selling aspect of it, not only the re merchandising of it, the photographing it again. However, having that good, solid conversation with your staff about what that product is, how educate them on how it's going to solve a problem for a customer. What is the fit? Like, what are, you know, how about the pockets? What. Just what's the. How do you wash it? How do you. How do you take care of it? How is it going to suck your belly in or cover up your. Your arms or whatever it's going to do? How are you going to be able go from night to or day to night, all these kind of things, setting that tone and creating that experience and giving that customer that visual of how they're going to use it, how many wares they're going to get out of it, all those kind of things can help turn your inventory faster. But again, like you said, if you're not excited about it, if you're not talking about it and creating this, this whole idea for your staff to communicate with your customers, it's not going to happen. And next thing you know, that very functional pair of trousers that have a tummy control in them that you can wash and dry in your own laundry, you know, in your own washer and dryer are just hanging there because that customer doesn't know that they're there and you don't. You're not communicating with that. That customer, what the functionality of this particular pair of pants is. Next thing you know, you tell them about it. You tell them how easy they are to launder, how great they fit all these kind of things. And that the customer's like, oh, my gosh, that's fantastic. I hate taking things to the dry cleaners. I want to be able to have something that has pockets that also has a tummy control in it. That is what I need. Well, there you go. You just have to have that conversation. But it's all about serving that customer. And we. That is one other thing that we do a ton of with Retail Bootcamp is the selling aspect.

I've got to elaborate on what you just said, man. You and I could squirrel all day long. When you and I were in Vegas at Magic this last time, one of our sponsors of our cocktail party was Hotline Hair Ties. Megan is a member of the Hub and I watched you do this, and you're such a queen at doing this. And I want everyone to take note of what it means to be a great buyer at market, because in order for you to have that conversation, like you said, with your customer, to educate her on the tummy control, denim or Whatever it is that the hot. The hair ties, in order for you to have that conversation or in order for yourself staff to have that conversation, you, of course, have to educate your staff. But where do you get your information? And that's from asking the right questions at market or asking the right questions of the vendor that you're doing business with. So when we ran into Megan, she was bringing over these adorable little packets of hair ties, you know, like the little coiled, stretchy ones for our swag bags. And you pulled one out, and you're like, oh, that's cute. And then the first thing you did was, okay, Megan, give me the details. What makes your hair ties different than everyone else's? And what's the number one problem that your customers have with these hair ties that you can solve? Yeah, I was like, whoa, amazing. Elaborate. Tell us what she answered.

Well, so with that. That product, you know, one of the things that I always knew was a problem for me because my daughters would have them is when they'd stretch out, and I would. I'd think, okay, so they've stretched out. Now what do I do? Well, she said. She goes, oh, yeah? Well, what the deal with this box is, you have them for thick hair, you have one for th thin hair, you have one for curly hair, and you have. If they stretch out, all you have to do is heat them back up, throw them in some hot water, and they retract good as new again. And all of a sudden, I thought, oh, well, duh, that solves that problem. And now I need to make sure my customers would be educated on that or my daughters. And honestly, that was one of the first conversations I had with them when I came home. It's like, okay, here's the deal. Do not throw these away. They. They still have value. Once they're stretched out, we just need to throw them in hot water and they'll be good, good as new again. And because from a customer, a consumer standpoint, you might buy those once and think they stretched out, throw them away, and never go back and buy them again because you weren't properly educated. And all it needed was one bit of information to keep that customer satisfied and feel like they've really got a good product.

Right?

And yeah, and I think that going forward again, when you go to buy on these buying trips, because. And I guess I'm saying this because I was guilty of this too. I would walk into someplace or I'd see something online, and I would buy it because I thought it was cute. And sometimes I didn't even actually touch it or to have them turn it around. One time I bought this super cute denim jacket. I was in love with it. We were so excited about it. So excited about it. We got it.

We.

We unboxed it, hung it on a hanger, and I spun it around to do something with it. And all of a sudden I was like, oh, what is this? And there was this huge tattoo deal all over the back of it with, like, shoes shreds. And everybody stood there. We were just like, what in the world? They ruined this beautiful jacket. I called the company and they're like, no, it was not. I said, I think you sent me something. And, you know, this isn't what we ordered. I just ordered the denim jacket, and they said, we don't have a plain denim jacket. That's the one you saw at Market well Dosser. You didn't spin it around and look at the back. I just ordered it from the front. I ordered, like, I think I ordered 20 of them. And there they were. Talk about buying steak. Getting a little, you know, putting the cart before the horse. No. So that's. Maybe that's the reason that I like. Okay, Megan, now tell me all about this product. Tell me what the biggest problem is. What's the complaint? How does we solve it? You know, those kind of things? Because taking that time to figure out what the product is, to know about it before you invest your money in it can. Oh, my gosh. The. The time it took me to return those 20 jackets. And the other thing about it was, from a business standpoint, I tied up my dollars. I tied up a couple hundred dollars in denim jackets, thinking I had my resource for denim jackets satisfied, but I actually didn't. And so then in our community, denim jackets are a huge thing over sundresses and things like that in Wisconsin because of the weather. So all of a sudden, not only did I not have my denim jackets because nobody was going to wear those, I also couldn't sell a lot of my sundresses or my tank tops because my girls needed to have that layering piece over top of them to be able to make them work here in Wisconsin. So it really. I took a big hit all on the fact that I got excited and I did not properly educate myself on the product when I bought it.

Man. You know, it leads me to another point. I'll squirrel again, but it's that cheaper is not better. And I think today in fashion, where so many boutiques are caught up in this fast fashion world where what's the price, how cheap is it? Let me get it. Because they think they can make a great margin on it and people are starting to get away from some of the better brands. You know, they have a little bit more cost, a little higher retail price, but really I think for the wrong reasons. And so I think if you hear what Sarah is saying and you're educating yourself on what is the real value of this product and why is it more expensive really in terms of quality and is there some type of like warranty or guarantee or something else with this product that I'm just not making myself aware of, then it absolutely holds more value and you can charge more for it and you can make more markup and margin from that product. But you have to be willing to explore that cheaper is not better. Cheaper does not sell great products over time and it does not build a business over time, but providing great value for your customers does. Can you go on elaborate on that, Sarah?

Oh my goodness, 100%. I will totally agree. And what's funny is again, I've been in this business a long time, so I, I, I was in the business before the fast fashion really hit the scene. And over, over the last probably, I don't know, we'll say, you know, eight years I've had conversations with some of these better brands and they're just, they and now I feel like, like you said, it's coming back around full circle. But even probably four or five, six years ago where they were, they saw the fast fashion thing really coming on, but they didn't get, they didn't get discouraged. They didn't change who they were. Like, these better brands have stayed better because they knew that a woman's time is very valuable and having that good, solid item for sale, that is, you're going to invest your time in and you don't have to think about it again. You're not going to have to return it because it fell apart. You're not going to have to come back and file a complaint. You're not going to have to do these kind of things. They've kind of waited that out and now they're seeing it and they're giggling about it again. They're like, yep, we knew it. You know, you tick a customer off enough by giving them something that is not quality and they'll never ever forget that when they buy something that might be 5, $10 more, they don't even think about that price after they realize the product is awesome and the product is satisfying their needs and the product Is still, still looks great today. Same as it did two months ago, same as it might have last season. Right. So. But that customer's quick, quick, quick, quick to throw you to the fire if they voted with you and spent money with you and then it all falls apart.

Yes, absolutely, man. 100% comes back around. And your customers are pretty quick to share those experiences.

Oh, for sure. Yeah. And I, and I, there's no reason why they shouldn't, you know, I am the same way. I, you know, my, when I go shopping or when I take time to invest in, you know, my clothes for myself or my kids, whatever it is, I know we're all out there, the laundry room's full of clothes, it's time to wash. And you literally just scoop up and throw in the washing machine. A lot of things you, you know, you have to be really careful with. And I like to buy things that I don't, I like to buy things that I don't have to iron. I like to buy things that I can throw in the washing machine, put them in the dryer, throw them on and run out the door. Because I'm, I, that's how I roll. And therefore there's a lot of places I cannot shop. I can't. My needs aren't satisfied with a lot of that stuff. And, and I'm not the only person. And people are definitely willing to spend the money on good quality items that aren't going to be, you're not going to be standing there in a circle of friends and realize your buttons have fallen off or whatever it is. And which is which I've seen happen, you know, and I've seen that seam ripped out on the back of a girl's blazer before. Just walking around and you say something, you know, excuse me, ma', am, you know, whatever it is, and they're like, oh my gosh, I just bought this and first thing, I'm never going back there. But yet, from a boutique owner standpoint, why would we put our, our customers in that position? Why would we falter on giving them an amazing price on something when we, we're not even 100% sure that it's going to make it through their day? So from a customer service standpoint, if, when you're making that sale with a customer, you can say, if you ever have any problems with this, bring it back to me. Because not only will I stand behind it, the vendor will stand behind it as well. When you can give that seal of approval and that, that guarantee to that customer, oh, my Gosh, they literally will look at you just like, are you serious? I hardly ever hear that anymore. And so that is what sets us apart from other people. That can be what those boutique owners can do to set you apart. Now don't do it on something that you don't have confidence in, but that's when people will continue to look to you as a resource to satisfy their needs. And that's, that's where, that's where your money turns up. You know, comes off the hangers, goes into your, your point of sale system, straight into your bank. Next thing you know, you know you're buying that car or you're going on that trip or whatever it is. And that's, that's what we're all in the, in the business for. Retail. You know, retail business is about buying a product, marking it up, selling it for profit and continuing that on, reinvesting that back in inventory, building that business. It's not here to barely make money. That's not we, what we got in the business for.

Yeah. Oh my gosh. I feel like our time just absolutely flew by today because these are all so such great things. Thank you for coming and dropping all these knowledge bombs today. This is so good.

You know, I, I will just say retail boot camp has been one of those things for me that it is just I, I, I get a lot like on fire talking about this sort of thing. But these are all things that I wish I would have known when I got started. I would have not made the thousands of dollars of mistakes that I did when I first got started and I got started in, you know, like prematurely. And so I think that is the one thing about this course that I love is giving people from the get go the knowledge and the experiences. And also for these people that are kind of reinventing their business, wanting to, you know, go to that next level, giving them that foundation and what they, what I wish I would have known when I was 20 is that's another my favorite books. And this is what I think this course is.

Yeah. And it's definitely like from everything that you've shared and then some. It's 12 weeks, 12 modules, all that. Definitely the most in depth course that we've found anywhere on the market. Done a lot of research on that just to make sure it is no stone is unturned in terms of what's covered inside. So I really appreciate that for sure.

You bet. Yeah. 12 weeks. I mean they get personal, face to face time with us and yeah, lots of fun stuff. The workbooks all that kind of stuff that they get. Yes. Great course.

So the fun part is because you and I are in the middle of it. I mean, the course isn't even open for enrollment right now. It only is open two times a year. So really, the reason we came on this podcast was just like, we felt that we had to share this information with everybody, just like a couple of these major takeaways, because we get these questions all the time, and we don't want you guys to go another day in business without knowing these things. So even if you're not in Bootcamp, we really hope that this episode was helpful and beneficial to you. And next time Bootcamp opens, if you want, I suppose I could drop a link inside of the show notes if you want to get on the waiting list for next time. But if you've got questions, DM us. And should we do a fun little giveaway today? Sarah, you up for that?

Absolutely. I love giveaways. Let's do it.

All right, perfect. So you guys know the drill. While you're listening to the episode, make sure you snap a picture of what you're doing while you're listening to today's episode and send us a DM or put it on your story and tag either AJ Alderson or Boutique Hub Business on Instagram and then let us know what was your number one biggest takeaway from this conversation today. And we'll go through only in the next week that this podcast is up before a new one comes up. After this, we'll go through all the answers and then we will pick a winner to win a 30 minute phone call with Sarah and I where we'll dissect your business together on like a video chat for 30 minutes. Sound good?

That sounds awesome. You bet. All right.

All right, you guys, I can't wait to hear your takeaways from today's episode. Leave us a review, subscribe to the show and let us know what you think about your takeaway. We can't wait to to get to meet one of you after this week's episode. So, you guys, thank you so much for your time today spending time with Sarah and I. And Sarah, thank you for being on the show.

You bet. Thanks for having me, everybody. Good luck in your businesses.

All right, thanks, guys. Hey, guys, thank you so much for listening to this episode. We hope that you loved it. Don't forget to hit subscribe and leave a rating and review down below for a chance to be one of our featured listeners each and every week. For more information on our spirit of community over competition and how to access complete show notes and bonus downloads from our guests. Head on over to the boutiquehub.com and join the community. We'll see you next week.

Sa.